##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2010
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1937
 For the transition period from  to
 Commission File No. 001-16101
 BANCORP RHODE ISLAND, INC.
  Rhode Island
    
    05-0509802(State or other jurisdiction of 
incorporation or organization)
    
    (IRS Employer
Identification No.)
 ONE TURKS HEAD PLACE, PROVIDENCE, RI 02903
   (Registrants telephone number, including area code)
  (Former name, former address and former fiscal year, if changed since last report)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o
 o x
  Common Stock - Par Value $0.01
    
    4,674,092 shares(class)
    
    (outstanding)




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##### 



BANCORP RHODE ISLAND, INC.
Quarterly Report on Form 10-Q
Table of Contents
 Description
    
    Page NumberCover Page
    
    
    1Table of Contents
    
    
    2Part I  Financial InformationItem 1. Financial Statements (unaudited)Consolidated Balance Sheets
    
    
    3Consolidated Statements of Operations
    
    
    4Consolidated Statements of Changes in Shareholders Equity
    
    
    5Consolidated Statements of Cash Flows
    
    
    6Condensed Notes to Consolidated Financial Statements
    
    
    7-21Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    22-44Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    45Item 4. Controls and Procedures
    
    
    46Part II  Other InformationItem 1. Legal Proceedings
    
    
    47Item 1A. Risk Factors
    
    
    47-48Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    48Item 3. Defaults Upon Senior Securities
    
    
    48Item 5. Other Information
    
    
    48Item 6. Exhibits
    
    
    49Signature Page
    
    
    50Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
  Special Note Regarding Forward Looking Statements
    2




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##### Table of Contents



BANCORP RHODE ISLAND, INC.
 
 Consolidated Balance Sheets (unaudited)
 September 30,
    
    
    December 31,2010
    
    
    2009(In thousands)ASSETS:Cash and due from banks
    
    $
    15,828
    
    
    $
    18,866Overnight investments
    
    
    451
    
    
    
    1,964Total cash and cash equivalents
    
    
    16,279
    
    
    
    20,830Available for sale securities (amortized cost of $334,074 and
$380,108, respectively)
    
    
    342,080
    
    
    
    381,839Stock in Federal Home Loan Bank of Boston
    
    
    16,274
    
    
    
    16,274Loans and leases receivable:Commercial loans and leases
    
    
    771,754
    
    
    
    732,397Residential mortgage loans
    
    
    161,106
    
    
    
    173,294Consumer and other loans
    
    
    202,367
    
    
    
    206,156Total loans and leases receivable
    
    
    1,135,227
    
    
    
    1,111,847Allowance for loan and lease losses
    
    
    (18,212
    )
    
    
    (16,536
    )Net loans and leases receivable
    
    
    1,117,015
    
    
    
    1,095,311Premises and equipment, net
    
    
    12,072
    
    
    
    12,378Goodwill, net
    
    
    12,262
    
    
    
    12,239Accrued interest receivable
    
    
    4,648
    
    
    
    4,964Investment in bank-owned life insurance
    
    
    30,964
    
    
    
    30,010Prepaid expenses and other assets
    
    
    21,729
    
    
    
    16,101Total assets
    
    $
    1,573,323
    
    
    $
    1,589,946LIABILITIES:Deposits:Demand deposit accounts
    
    $
    242,628
    
    
    $
    204,281NOW accounts
    
    
    66,166
    
    
    
    74,558Money market accounts
    
    
    82,151
    
    
    
    65,076Savings accounts
    
    
    364,160
    
    
    
    367,225Certificate of deposit accounts
    
    
    360,578
    
    
    
    387,144Total deposits
    
    
    1,115,683
    
    
    
    1,098,284Overnight and short-term borrowings
    
    
    36,028
    
    
    
    40,171Wholesale repurchase agreements
    
    
    20,000
    
    
    
    20,000Federal Home Loan Bank of Boston borrowings
    
    
    232,024
    
    
    
    277,183Subordinated deferrable interest debentures
    
    
    13,403
    
    
    
    13,403Other liabilities
    
    
    25,416
    
    
    
    20,244Total liabilities
    
    
    1,442,554
    
    
    
    1,469,285SHAREHOLDERS EQUITY:Common stock, par value $0.01 per share, authorized 11,000,000
shares: Issued: 5,047,942 and 4,969,444 shares, respectively
    
    
    50
    
    
    
    50Additional paid-in capital
    
    
    73,697
    
    
    
    72,783Treasury stock, at cost: 373,850 and 364,750 shares, respectively
    
    
    (12,527
    )
    
    
    (12,309
    )Retained earnings
    
    
    64,345
    
    
    
    59,012Accumulated other comprehensive income, net
    
    
    5,204
    
    
    
    1,125Total shareholders equity
    
    
    130,769
    
    
    
    120,661Total liabilities and shareholders equity
    
    $
    1,573,323
    
    
    $
    1,589,946
 See accompanying notes to unaudited consolidated financial statements
  3




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##### Table of Contents



BANCORP RHODE ISLAND, INC.
 
 Consolidated Statements of Operations (unaudited)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2010
    
    
    2009
    
    
    2010
    
    
    2009(In thousands, except per share data)Interest and dividend income:Overnight investments
    
    $
    1
    
    
    $
    1
    
    
    $
    6
    
    
    $
    10Mortgage-backed securities
    
    
    2,764
    
    
    
    3,336
    
    
    
    9,034
    
    
    
    10,099Investment securities
    
    
    462
    
    
    
    540
    
    
    
    1,502
    
    
    
    1,527Loans and leases
    
    
    14,927
    
    
    
    15,123
    
    
    
    44,600
    
    
    
    44,716Total interest and dividend income
    
    
    18,154
    
    
    
    19,000
    
    
    
    55,142
    
    
    
    56,352Interest expense:Deposits
    
    
    1,910
    
    
    
    3,308
    
    
    
    6,352
    
    
    
    12,026Overnight and short-term borrowings
    
    
    16
    
    
    
    19
    
    
    
    53
    
    
    
    67Wholesale repurchase agreements
    
    
    139
    
    
    
    141
    
    
    
    421
    
    
    
    408Federal Home Loan Bank of Boston borrowings
    
    
    2,438
    
    
    
    2,691
    
    
    
    7,621
    
    
    
    7,966Subordinated deferrable interest debentures
    
    
    173
    
    
    
    175
    
    
    
    503
    
    
    
    564Total interest expense
    
    
    4,676
    
    
    
    6,334
    
    
    
    14,950
    
    
    
    21,031Net interest income
    
    
    13,478
    
    
    
    12,666
    
    
    
    40,192
    
    
    
    35,321Provision for loan and lease losses
    
    
    1,275
    
    
    
    1,900
    
    
    
    4,425
    
    
    
    6,110Net interest income after provision for loan
and lease losses
    
    
    12,203
    
    
    
    10,766
    
    
    
    35,767
    
    
    
    29,211Noninterest income:Total other-than-temporary impairment losses on
available for sale securities
    
    
    5
    
    
    
    (696
    )
    
    
    54
    
    
    
    (696
    )Non-credit component of other-than-temporary losses
recognized in other comprehensive income
    
    
    (422
    )
    
    
    626
    
    
    
    (1,086
    )
    
    
    626Credit component of other-than-temporary impairment
losses on available for sale securities
    
    
    (417
    )
    
    
    (70
    )
    
    
    (1,032
    )
    
    
    (70
    )Service charges on deposit accounts
    
    
    1,337
    
    
    
    1,396
    
    
    
    3,949
    
    
    
    3,973Gain on sale of available for sale securities
    
    
    465
    
    
    
    
    
    
    
    1,043
    
    
    
    61Income from bank-owned life insurance
    
    
    320
    
    
    
    313
    
    
    
    953
    
    
    
    906Loan related fees
    
    
    162
    
    
    
    75
    
    
    
    484
    
    
    
    703Commissions on nondeposit investment products
    
    
    144
    
    
    
    322
    
    
    
    529
    
    
    
    589Net gains on lease sales and commissions on loans
originated for others
    
    
    44
    
    
    
    13
    
    
    
    86
    
    
    
    61Other income
    
    
    234
    
    
    
    192
    
    
    
    877
    
    
    
    589Total noninterest income
    
    
    2,289
    
    
    
    2,241
    
    
    
    6,889
    
    
    
    6,812Noninterest expense:Salaries and employee benefits
    
    
    5,829
    
    
    
    5,224
    
    
    
    17,418
    
    
    
    15,303Occupancy
    
    
    827
    
    
    
    864
    
    
    
    2,517
    
    
    
    2,652Data processing
    
    
    667
    
    
    
    659
    
    
    
    1,975
    
    
    
    1,949Professional services
    
    
    549
    
    
    
    609
    
    
    
    1,718
    
    
    
    1,953FDIC insurance
    
    
    475
    
    
    
    502
    
    
    
    1,425
    
    
    
    2,065Marketing
    
    
    333
    
    
    
    327
    
    
    
    974
    
    
    
    974Equipment
    
    
    266
    
    
    
    226
    
    
    
    776
    
    
    
    709Loan workout and other real estate owned
    
    
    196
    
    
    
    219
    
    
    
    869
    
    
    
    496Loan servicing
    
    
    133
    
    
    
    174
    
    
    
    480
    
    
    
    522Other expenses
    
    
    1,075
    
    
    
    1,008
    
    
    
    3,116
    
    
    
    2,957Total noninterest expense
    
    
    10,350
    
    
    
    9,812
    
    
    
    31,268
    
    
    
    29,580Income before income taxes
    
    
    4,142
    
    
    
    3,195
    
    
    
    11,388
    
    
    
    6,443Income tax expense
    
    
    1,334
    
    
    
    992
    
    
    
    3,680
    
    
    
    2,037Net income
    
    
    2,808
    
    
    
    2,203
    
    
    
    7,708
    
    
    
    4,406Preferred stock dividends
    
    
    
    
    
    
    (142
    )
    
    
    
    
    
    
    (892
    )Prepayment charges and accretion of preferred stock discount
    
    
    
    
    
    
    (1,282
    )
    
    
    
    
    
    
    (1,405
    )Net income applicable to common shares
    
    $
    2,808
    
    
    $
    779
    
    
    $
    7,708
    
    
    $
    2,109Per share data:Basic earnings per common share
    
    $
    0.60
    
    
    $
    0.17
    
    
    $
    1.65
    
    
    $
    0.46Diluted earnings per common share
    
    $
    0.60
    
    
    $
    0.17
    
    
    $
    1.65
    
    
    $
    0.46Cash dividends declared per common share
    
    $
    0.17
    
    
    $
    0.17
    
    
    $
    0.51
    
    
    $
    0.51Weighted average common shares outstanding  basic
    
    
    4,674
    
    
    
    4,606
    
    
    
    4,653
    
    
    
    4,599Weighted average common shares outstanding  diluted
    
    
    4,703
    
    
    
    4,634
    
    
    
    4,682
    
    
    
    4,620
 See accompanying notes to unaudited consolidated financial statements
  4




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##### Table of Contents



BANCORP RHODE ISLAND, INC.
 
 Consolidated Statements of Changes in Shareholders Equity (unaudited)
 AccumulatedOtherAdditional
    
    
    
    
    
    
    
    
    
    
    Compre-Preferred
    
    
    Common
    
    
    Paid-in
    
    
    Treasury
    
    
    Retained
    
    
    hensiveNine months ended September 30,
    
    Stock
    
    
    Stock
    
    
    Capital
    
    
    Stock
    
    
    Earnings
    
    
    Income (Loss)
    
    
    Total(In thousands, except per share data)2009Balance at December 31, 2008
    
    $
    28,595
    
    
    $
    49
    
    
    $
    73,323
    
    
    $
    (12,055
    )
    
    $
    58,763
    
    
    $
    415
    
    
    $
    149,090Cumulative effect of a change in accounting
principle, net of taxes of ($77)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    137
    
    
    
    (137
    )
    
    
    Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,406
    
    
    
    
    
    
    
    4,406Other comprehensive income:Unrealized holding gains on
securities available for sale, net
of taxes of ($1,682)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,124
    
    
    
    3,124Reclassification adjustment for
net gains included in net income,
net of taxes of $21
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (40
    )
    
    
    (40
    )Non-credit portion OTTI, net of taxes
of $220
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (406
    )
    
    
    (406
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,084Exercise of stock options
    
    
    
    
    
    
    1
    
    
    
    438
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    439Macrolease acquisition
    
    
    
    
    
    
    
    
    
    
    78
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    78Repurchase of warrant
    
    
    
    
    
    
    
    
    
    
    (1,400
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,400
    )Redemption of preferred stock
    
    
    (30,000
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (30,000
    )Treasury stock acquisitions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (254
    )
    
    
    
    
    
    
    
    
    
    
    (254
    )Share-based compensation
    
    
    
    
    
    
    
    
    
    
    80
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    80Tax benefit from exercise of stock options
    
    
    
    
    
    
    
    
    
    
    81
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    81Preferred stock discount accretion
    
    
    123
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (123
    )
    
    
    
    
    
    
    Prepayment charge on preferred stock discount
    
    
    1,282
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,282
    )
    
    
    
    
    
    
    Dividends on preferred stock ($29.73 per
preferred share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (892
    )
    
    
    
    
    
    
    (892
    )Dividends on common stock ($0.51 per
common share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,345
    )
    
    
    
    
    
    
    (2,345
    )Balance at September 30, 2009
    
    $
    
    
    
    $
    50
    
    
    $
    72,600
    
    
    $
    (12,309
    )
    
    $
    58,664
    
    
    $
    2,956
    
    
    $
    121,9612010Balance at December 31, 2009
    
    $
    
    
    
    $
    50
    
    
    $
    72,783
    
    
    $
    (12,309
    )
    
    $
    59,012
    
    
    $
    1,125
    
    
    $
    120,661Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,708
    
    
    
    
    
    
    
    7,708Other comprehensive income:Unrealized holding gains on
securities available for sale, net
of taxes of ($2,181)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,051
    
    
    
    4,051Reclassification adjustment for
net gains included in net income,
net of taxes of $365
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (678
    )
    
    
    (678
    )Non-credit portion OTTI, net of taxes
of ($380)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    706
    
    
    
    706Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,787Exercise of stock options
    
    
    
    
    
    
    
    
    
    
    297
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    297Macrolease acquisition
    
    
    
    
    
    
    
    
    
    
    211
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    211Share repurchases
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (218
    )
    
    
    
    
    
    
    
    
    
    
    (218
    )Share-based compensation
    
    
    
    
    
    
    
    
    
    
    410
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    410Tax benefit from exercise of stock options
    
    
    
    
    
    
    
    
    
    
    (4
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4
    )Dividends on common stock ($0.51
per common share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,375
    )
    
    
    
    
    
    
    (2,375
    )Balance at September 30, 2010
    
    $
    
    
    
    $
    50
    
    
    $
    73,697
    
    
    $
    (12,527
    )
    
    $
    64,345
    
    
    $
    5,204
    
    
    $
    130,769
 See accompanying notes to unaudited consolidated financial statements
  5




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##### Table of Contents



BANCORP RHODE ISLAND, INC.
 
 Consolidated Statements of Cash Flows (unaudited)
 Nine Months EndedSeptember 30,2010
    
    
    2009(In thousands)Cash flows from operating activities:Net income
    
    $
    7,708
    
    
    $
    4,406Adjustments to reconcile net income to net cash provided by operating activities:Depreciation, amortization and accretion, net
    
    
    (1,128
    )
    
    
    (4,563
    )Provision for loan and lease losses
    
    
    4,425
    
    
    
    6,110Income from bank-owned life insurance
    
    
    (953
    )
    
    
    (906
    )Share-based compensation expense
    
    
    410
    
    
    
    80Net gains on lease sales
    
    
    (54
    )
    
    
    (26
    )Gain on sale of available for sale securities
    
    
    (1,043
    )
    
    
    (61
    )Credit component of other-than-temporary impairment
losses on available for sale securities
    
    
    1,032
    
    
    
    70Gain on sale of other real estate owned
    
    
    (57
    )
    
    
    (38
    )Proceeds from sales of leases
    
    
    1,102
    
    
    
    976Leases originated for sale
    
    
    (1,048
    )
    
    
    (794
    )Decrease in accrued interest receivable
    
    
    316
    
    
    
    414(Increase) decrease in prepaid expenses and other assets
    
    
    (777
    )
    
    
    188Increase (decrease) in other liabilities
    
    
    210
    
    
    
    (1,724
    )Net cash provided by operating activities
    
    
    10,143
    
    
    
    4,132Cash flows from investing activities:Available for sale securities:Purchases
    
    
    (116,917
    )
    
    
    (163,639
    )Maturities and principal repayments
    
    
    147,301
    
    
    
    126,490Proceeds from sales
    
    
    12,978
    
    
    
    1,880Net increase in loans and leases
    
    
    (24,959
    )
    
    
    (39,631
    )Capital expenditures for premises and equipment
    
    
    (760
    )
    
    
    (965
    )Proceeds from sale of other real estate owned
    
    
    1,866
    
    
    
    988Purchase of Federal Home Loan Bank of Boston stock
    
    
    
    
    
    
    (603
    )Net cash provided by (used in) investing activities
    
    
    19,509
    
    
    
    (75,480
    )Cash flows from financing activities:Net increase in deposits
    
    
    17,399
    
    
    
    49,739Net decrease in overnight and short-term borrowings
    
    
    (4,143
    )
    
    
    (8,645
    )Proceeds from long-term borrowings
    
    
    42,430
    
    
    
    80,791Repayment of long-term borrowings
    
    
    (87,589
    )
    
    
    (52,080
    )Exercise of stock options
    
    
    79
    
    
    
    439Repurchase of warrant
    
    
    
    
    
    
    (1,400
    )Redemption of preferred stock
    
    
    
    
    
    
    (30,000
    )Repurchase of common stock
    
    
    
    
    
    
    (254
    )Tax (expense) benefit from exercise of stock options
    
    
    (4
    )
    
    
    81Dividends on preferred stock
    
    
    
    
    
    
    (892
    )Dividends on common stock
    
    
    (2,375
    )
    
    
    (2,345
    )Net cash
(used in) provided by financing activities
    
    
    (34,203
    )
    
    
    35,434Net decrease in cash and cash equivalents
    
    
    (4,551
    )
    
    
    (35,914
    )Cash and cash equivalents at beginning of period
    
    
    20,830
    
    
    
    55,457Cash and cash equivalents at end of period
    
    $
    16,279
    
    
    $
    19,543Supplementary Disclosures:Cash paid for interest
    
    $
    15,664
    
    
    $
    21,789Cash paid for income taxes
    
    
    3,965
    
    
    
    2,404Non-cash investing and financing transactions:Change in accumulated other comprehensive income, net of taxes
    
    
    3,373
    
    
    
    3,084Cumulative effect of a change in accounting principle, net of taxes
    
    
    
    
    
    
    137Goodwill increase related to Macrolease acquisition
    
    
    23
    
    
    
    78Transfer of loans to other real estate owned
    
    
    1,239
    
    
    
    2,083Treasury stock acquisitions from shares tendered in stock option exercises
    
    
    218
    
    
    
    254Non-credit component of other-than-temporary impairment, net of taxes
    
    
    (706
    )
    
    
    406Net sales of available for sale securities not yet settled
    
    
    2,468
    
    
    
    
 See accompanying notes to unaudited consolidated financial statements
  6




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##### Table of Contents



BANCORP RHODE ISLAND, INC.
 
 Notes to Consolidated Financial Statements (unaudited)
 (1) Basis of Presentation
       (2) Earnings Per Share
   7




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##### Table of Contents



Three Months EndedSeptember 30,
    
    
    September 30,2010
    
    
    2009(In thousands, except per share data)Basic EPS Computation:Numerator:Net income
    
    $
    2,808
    
    
    $
    2,203Preferred stock dividend
    
    
    
    
    
    
    (142
    )Preferred stock accretion
    
    
    
    
    
    
    (1,282
    )Net income applicable to common shares
    
    $
    2,808
    
    
    $
    779Denominator:Weighted average shares outstanding
    
    
    4,674
    
    
    
    4,606Basic EPS
    
    $
    0.60
    
    
    $
    0.17Diluted EPS Computation:Numerator:Net income applicable to common shares
    
    $
    2,808
    
    
    $
    779Denominator:Common shares outstanding
    
    
    4,674
    
    
    
    4,606Stock options
    
    
    27
    
    
    
    28Contingent shares
    
    
    2
    
    
    
    Total shares
    
    
    4,703
    
    
    
    4,634Diluted EPS
    
    $
    0.60
    
    
    $
    0.17
  (3) Recently Adopted Accounting Pronouncements
 Transfers and Servicing Accounting for Transfers of Financial Assets, an amendment of FASB Statement No.
140,
 Consolidations Amendments to FASB
Interpretation No. 46(R),
  8




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##### Table of Contents



Fair Value
Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Instruments
 (4) Recently Issued Accounting Pronouncements
 Receivables (Topic 320): Disclosures About the
Credit Quality of Financing Receivables and the Allowance for Credit Losses Receivables
 (5) Available for Sale Securities
   9




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##### Table of Contents



Amortized
    
    
    Unrealized
    
    
    UnrealizedCost(1)
    
    
    Gains
    
    
    Losses
    
    
    Fair Value(In thousands)At September 30, 2010:GSE obligations
    
    $
    71,004
    
    
    $
    742
    
    
    $
    
    
    
    $
    71,746Trust preferred CDOs
    
    
    1,518
    
    
    
    
    
    
    
    (999
    )
    
    
    519Collateralized mortgage obligations
    
    
    33,404
    
    
    
    675
    
    
    
    (1,359
    )
    
    
    32,720GSE mortgage-backed securities
    
    
    228,148
    
    
    
    9,014
    
    
    
    (67
    )
    
    
    237,095Total
    
    $
    334,074
    
    
    $
    10,431
    
    
    $
    (2,425
    )
    
    $
    342,080At December 31, 2009:GSE obligations
    
    $
    80,866
    
    
    $
    347
    
    
    $
    (287
    )
    
    $
    80,926Trust preferred CDOs
    
    
    2,550
    
    
    
    
    
    
    
    (2,085
    )
    
    
    465Collateralized mortgage obligations
    
    
    45,641
    
    
    
    697
    
    
    
    (2,311
    )
    
    
    44,027GSE mortgage-backed securities
    
    
    251,051
    
    
    
    6,353
    
    
    
    (983
    )
    
    
    256,421Total
    
    $
    380,108
    
    
    $
    7,397
    
    
    $
    (5,666
    )
    
    $
    381,839
 (1)
    
    Amortized cost is net of write-downs as a result of other-than-temporary
impairment.   Num-ber of
    
    
    Less than One Year
    
    
    One Year or Longer
    
    
    TotalHold-
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealized
    
    
    Fair
    
    
    Unrealizedings
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses
    
    
    Value
    
    
    Losses(Dollars in thousands)At September 30, 2010:Trust preferred CDOs
    
    
    2
    
    
    $
    
    
    
    $
    
    
    
    $
    519
    
    
    $
    (999
    )
    
    $
    519
    
    
    $
    (999
    )Collateralized mortgage
obligations
    
    
    3
    
    
    
    2,103
    
    
    
    (8
    )
    
    
    8,481
    
    
    
    (1,351
    )
    
    
    10,584
    
    
    
    (1,359
    )GSE mortgage-backed securities
    
    
    3
    
    
    
    10,262
    
    
    
    (67
    )
    
    
    
    
    
    
    
    
    
    
    10,262
    
    
    
    (67
    )Total
    
    
    8
    
    
    $
    12,365
    
    
    $
    (75
    )
    
    $
    9,000
    
    
    $
    (2,350
    )
    
    $
    21,365
    
    
    $
    (2,425
    )At December 31, 2009:GSE obligations
    
    
    8
    
    
    $
    37,081
    
    
    $
    (287
    )
    
    $
    
    
    
    $
    
    
    
    $
    37,081
    
    
    $
    (287
    )Trust preferred CDOs
    
    
    2
    
    
    
    
    
    
    
    
    
    
    
    465
    
    
    
    (2,085
    )
    
    
    465
    
    
    
    (2,085
    )Collateralized mortgage
obligations
    
    
    5
    
    
    
    5,520
    
    
    
    (182
    )
    
    
    12,088
    
    
    
    (2,129
    )
    
    
    17,608
    
    
    
    (2,311
    )GSE mortgage-backed securities
    
    
    18
    
    
    
    69,310
    
    
    
    (982
    )
    
    
    140
    
    
    
    (1
    )
    
    
    69,450
    
    
    
    (983
    )Total
    
    
    33
    
    
    $
    111,911
    
    
    $
    (1,451
    )
    
    $
    12,693
    
    
    $
    (4,215
    )
    
    $
    124,604
    
    
    $
    (5,666
    )
  10




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##### Table of Contents



After One, But
    
    
    After Five, ButWithin Five Years
    
    
    Within Ten Years
    
    
    After Ten YearsAmortized
    
    
    Fair
    
    
    Amortized
    
    
    Fair
    
    
    Amortized
    
    
    FairCost
    
    
    Value
    
    
    Cost
    
    
    Value
    
    
    Cost
    
    
    Value(In thousands)At September 30, 2010:GSE obligations
    
    $
    56,009
    
    
    $
    56,613
    
    
    $
    14,995
    
    
    $
    15,133
    
    
    $
    
    
    
    $
    Trust preferred CDOs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,518
    
    
    
    519Collateralized mortgage obligations
    
    
    
    
    
    
    
    
    
    
    17,248
    
    
    
    17,759
    
    
    
    16,156
    
    
    
    14,961GSE mortgage-backed securities
    
    
    4,737
    
    
    
    4,946
    
    
    
    15,030
    
    
    
    16,019
    
    
    
    208,381
    
    
    
    216,130Total
    
    $
    60,746
    
    
    $
    61,559
    
    
    $
    47,273
    
    
    $
    48,911
    
    
    $
    226,055
    
    
    $
    231,610At December 31, 2009:GSE obligations
    
    $
    75,866
    
    
    $
    76,013
    
    
    $
    5,000
    
    
    $
    4,913
    
    
    $
    
    
    
    $
    Trust preferred CDOs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,550
    
    
    
    465Collateralized mortgage obligations
    
    
    
    
    
    
    
    
    
    
    23,156
    
    
    
    22,957
    
    
    
    22,485
    
    
    
    21,070GSE mortgage-backed securities
    
    
    1,548
    
    
    
    1,604
    
    
    
    23,589
    
    
    
    24,624
    
    
    
    225,914
    
    
    
    230,193Total
    
    $
    77,414
    
    
    $
    77,617
    
    
    $
    51,745
    
    
    $
    52,494
    
    
    $
    250,949
    
    
    $
    251,728
      11




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##### Table of Contents



Credit Component of Other-Than-Temporary Impairment Losses For Whicha Portion Was Recognized in OtherComprehensive Income(In thousands)
    
    2010
    
    
    2009Balance, January 1
    
    $
    (384
    )
    
    $
    Credit losses for which an
other-than-temporary
impairment was previously
recognized
    
    
    (1,032
    )
    
    
    (70
    )Balance, September 30
    
    $
    (1,416
    )
    
    $
    (70
    )
   12




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##### Table of Contents



(6) Derivatives
   Asset DerivativesAs of
    
    
    As ofSeptember 30,
    
    
    December 31,Balance Sheet
    
    2010
    
    
    2009(In thousands)
    
    Location
    
    Fair ValueDerivatives notdesignated as hedging instrumentsInterest rate products
    
    Other assets
    
    $
    1,315
    
    
    $
    391Total derivatives notdesignated as hedging instruments
    
    
    
    $
    1,315
    
    
    $
    391
 Liability DerivativesAs of
    
    
    As ofSeptember 30,
    
    
    December 31,Balance Sheet
    
    2010
    
    
    2009(In thousands)
    
    Location
    
    Fair ValueDerivatives notdesignated as hedging instrumentsInterest rate products
    
    Other liabilities
    
    $
    1,386
    
    
    $
    426Total derivatives notdesignated as hedging instruments
    
    
    
    $
    1,386
    
    
    $
    426
   13




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##### Table of Contents



Amount of Gain or (Loss) Recognized inLocation of Gain or (Loss)
    
    Income on Derivative(1)Derivatives Not Designated as
    
    Recognized in Income on
    
    Three Months Ended September 30,Hedging Instruments
    
    Derivative
    
    2010
    
    
    2009(In thousands)Interest Rate Products
    
    Loan related fees
    
    $
    (12
    )
    
    $
    (63
    )Total
    
    
    
    $
    (12
    )
    
    $
    (63
    )
 (1)
    
    The amount of gain or (loss) recognized in income represents net fee income and
changes related to the fair value of the interest rate products.
  Amount of Gain or (Loss) Recognized inLocation of Gain or (Loss)
    
    Income on Derivative(1)Derivatives Not Designated as
    
    Recognized in Income on
    
Nine Months Ended September 30,Hedging Instruments
    
    Derivative
    
    2010
    
    
    2009(In thousands)Interest Rate Products
    
    Loan related fees
    
    $
    (36
    )
    
    $
    259Total
    
    
    
    $
    (36
    )
    
    $
    259
 (1)
    
    The amount of gain or (loss) recognized in income represents net fee income and
changes related to the fair value of the interest rate products.     14




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##### Table of Contents



(7) Fair Value of Financial Instruments
 Fair Value Measurements and Disclosures
      15




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##### Table of Contents



Fair Value Measurements at September 30, 2010 UsingQuoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    Otherfor Identical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    Inputs(In thousands)
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)GSE obligations
    
    $
    71,746
    
    
    $
    
    
    
    $
    71,746
    
    
    $
    Trust preferred CDOs
    
    
    519
    
    
    
    
    
    
    
    519
    
    
    
    Collateralized mortgage obligations
    
    
    32,720
    
    
    
    
    
    
    
    32,720
    
    
    
    GSE mortgage-backed securities
    
    
    237,095
    
    
    
    
    
    
    
    237,095
    
    
    
    Total available for sale securities
    
    
    342,080
    
    
    
    
    
    
    
    342,080
    
    
    
    Interest rate swap assets
    
    
    1,315
    
    
    
    
    
    
    
    1,315
    
    
    
    Interest rate swap liabilities
    
    
    1,386
    
    
    
    
    
    
    
    1,386
    
    
    
    
 Fair Value Measurements at December 31, 2009 UsingQuoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    Otherfor Identical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    Inputs(In thousands)
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)GSE obligations
    
    $
    80,926
    
    
    $
    
    
    
    $
    80,926
    
    
    $
    Trust preferred CDOs
    
    
    465
    
    
    
    
    
    
    
    465
    
    
    
    Collateralized mortgage obligations
    
    
    44,027
    
    
    
    
    
    
    
    44,027
    
    
    
    GSE mortgage-backed securities
    
    
    256,421
    
    
    
    
    
    
    
    256,421
    
    
    
    Total available for sale securities
    
    
    381,839
    
    
    
    
    
    
    
    381,839
    
    
    
    Interest rate swap assets
    
    
    391
    
    
    
    
    
    
    
    391
    
    
    
    Interest rate swap liabilities
    
    
    426
    
    
    
    
    
    
    
    426
    
    
    
    
   Available for sale securities 
  16




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##### Table of Contents



Interest rate swaps  Note 6  Derivatives.
  Fair Value Measurements Using SignificantUnobservable Inputs2010
    
    
    2009(In thousands)
    
    Trust preferred collateralized debt obligationsBalance, January 1
    
    $
    
    
    
    $
    1,480Increase in unrealized holding losses
    
    
    
    
    
    
    (299
    )Other-than-temporary impairment
    
    
    
    
    
    
    (696
    )Transfers to Level 2
    
    
    
    
    
    
    (485
    )Transfers to Level 3
    
    
    
    
    
    
    Balance, September 30
    
    $
    
    
    
    $
    
    17




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##### Table of Contents



Fair Value Measurements at September 30, 2010 UsingQuoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    Otherfor Identical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    Inputs(In thousands)
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Collateral-dependent loans and leases
    
    $
    1,069
    
    
    $
    
    
    
    $
    1,069
    
    
    $
    Other real estate owned
    
    
    130
    
    
    
    
    
    
    
    130
    
    
    
    
 Fair Value Measurements at September 30, 2009 UsingQuoted Prices in
    
    
    Significant
    
    
    SignificantActive Markets
    
    
    Other
    
    
    Otherfor Identical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Inputs
    
    
    Inputs(In thousands)
    
    Total
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Collateral-dependent loans and leases
    
    $
    3,199
    
    
    $
    
    
    
    $
    3,199
    
    
    $
    Other real estate owned
    
    
    2,083
    
    
    
    
    
    
    
    2,083
    
    
    
    
 Impaired loans 
 Other real estated owned and non-real estate foreclosed assets 
  Loans and leases receivable
  18




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##### Table of Contents



Stock in the Federal Home Loan Bank of Boston
 Deposits
 Wholesale repurchase agreements
 Federal Home Loan Bank of Boston borrowings
 Subordinated deferrable interest debentures
 Financial instruments with off-balance sheet risk
  19




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##### Table of Contents



September 30, 2010
    
    
    December 31, 2009Book
    
    
    Estimated
    
    
    Book
    
    
    EstimatedValue
    
    
    Fair Value
    
    
    Value
    
    
    Fair Value(In thousands)Assets:Cash and due from banks
    
    $
    15,828
    
    
    $
    15,828
    
    
    $
    18,866
    
    
    $
    18,866Overnight investments
    
    
    451
    
    
    
    451
    
    
    
    1,964
    
    
    
    1,964Available for sale securities
    
    
    342,080
    
    
    
    342,080
    
    
    
    381,839
    
    
    
    381,839Stock in the FHLB
    
    
    16,274
    
    
    
    16,274
    
    
    
    16,274
    
    
    
    16,274Loans and leases receivable, net of
allowance for loan and lease losses:Commercial loans and leases
    
    
    757,089
    
    
    
    780,643
    
    
    
    718,943
    
    
    
    725,967Residential mortgage loans
    
    
    159,447
    
    
    
    164,348
    
    
    
    171,842
    
    
    
    175,816Consumer and other loans
    
    
    200,479
    
    
    
    196,786
    
    
    
    204,526
    
    
    
    197,137Interest rate swaps
    
    
    1,315
    
    
    
    1,315
    
    
    
    391
    
    
    
    391Accrued interest receivable
    
    
    4,648
    
    
    
    4,648
    
    
    
    4,964
    
    
    
    4,964Liabilities:Deposits:Demand deposit accounts
    
    $
    242,628
    
    
    $
    242,628
    
    
    $
    204,281
    
    
    $
    204,281NOW accounts
    
    
    66,166
    
    
    
    66,166
    
    
    
    74,558
    
    
    
    74,558Money market accounts
    
    
    82,151
    
    
    
    82,151
    
    
    
    65,076
    
    
    
    65,076Savings accounts
    
    
    364,160
    
    
    
    364,160
    
    
    
    367,225
    
    
    
    367,225Certificate of deposit accounts
    
    
    360,578
    
    
    
    362,850
    
    
    
    387,144
    
    
    
    390,210Overnight and short-term borrowings
    
    
    36,028
    
    
    
    36,028
    
    
    
    40,171
    
    
    
    40,171Wholesale repurchase agreements
    
    
    20,000
    
    
    
    20,287
    
    
    
    20,000
    
    
    
    20,432FHLB borrowings
    
    
    232,024
    
    
    
    263,555
    
    
    
    277,183
    
    
    
    301,210Subordinated deferrable interest
debentures
    
    
    13,403
    
    
    
    14,713
    
    
    
    13,403
    
    
    
    15,440Interest rate swaps
    
    
    1,386
    
    
    
    1,386
    
    
    
    426
    
    
    
    426Accrued interest payable
    
    
    1,408
    
    
    
    1,408
    
    
    
    2,122
    
    
    
    2,122
 (8) Contingent Liabilities
    20




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##### Table of Contents



(9) Transfers and Servicing
    21




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##### Table of Contents



ITEM 2. Managements Discussion and Analysis
 General
 http://www.bankri.com SM
 Critical Accounting Policies
  Overview
  Rate/Volume Analysis Average Balances, Yields and Costs
 Interest Rate Risk
  22




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##### Table of Contents



Financial Condition  Asset Quality
      23




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##### Table of Contents



Financial Condition  Executive Summary
  September 30,
    
    
    June 30,
    
    
    March 31,
    
    
    December 31,
    
    
    September 30,2010
    
    
    2010
    
    
    2010
    
    
    2009
    
    
    2009(Dollars in thousands, except per share data)Total assets
    
    $
    1,573,323
    
    
    $
    1,613,520
    
    
    $
    1,586,778
    
    
    $
    1,589,946
    
    
    $
    1,569,084Loans and leases receivable
    
    
    1,135,227
    
    
    
    1,136,524
    
    
    
    1,123,838
    
    
    
    1,111,847
    
    
    
    1,116,627Available for sale securities
    
    
    342,080
    
    
    
    345,566
    
    
    
    365,110
    
    
    
    381,839
    
    
    
    365,706Goodwill, net
    
    
    12,262
    
    
    
    12,262
    
    
    
    12,262
    
    
    
    12,239
    
    
    
    12,051Core deposits (1)
    
    
    755,105
    
    
    
    813,697
    
    
    
    728,969
    
    
    
    711,140
    
    
    
    685,104Certificates of deposit
    
    
    360,578
    
    
    
    360,323
    
    
    
    378,102
    
    
    
    387,144
    
    
    
    406,827Borrowings
    
    
    301,455
    
    
    
    294,137
    
    
    
    341,344
    
    
    
    350,757
    
    
    
    340,081Common shareholders equity
    
    
    130,769
    
    
    
    129,127
    
    
    
    123,679
    
    
    
    120,661
    
    
    
    121,961Book value per common share
    
    
    27.98
    
    
    
    27.63
    
    
    
    26.69
    
    
    
    26.16
    
    
    
    26.46Tangible book value per common share
    
    
    25.35
    
    
    
    25.00
    
    
    
    24.05
    
    
    
    23.50
    
    
    
    23.85Tangible common equity ratio (2) (3)
    
    
    7.59
    %
    
    
    7.30
    %
    
    
    7.08
    %
    
    
    6.87
    %
    
    
    7.06
    %Core deposits to total deposits(1) (3)
    
    
    67.7
    %
    
    
    69.3
    %
    
    
    65.8
    %
    
    
    64.8
    %
    
    
    62.7
    %
 (1)
    
    Core deposits consist of demand deposit, NOW, money market and savings accounts.(2)
    
    Calculated by dividing common shareholders equity less goodwill by total assets
less goodwill.(3)
    
    Non-GAAP performance measure.    24




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##### Table of Contents



Financial Condition  Detailed Analysis
 Investments
        25




---



##### Table of Contents



Loans and Leases
  Commercial loans and leases 
     26




---



##### Table of Contents



Residential mortgage loans 
 Consumer loans 
  27




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##### Table of Contents



September 30,
    
    
    December 31,2010
    
    
    2009(In thousands)Commercial loans and leases:Commercial real estate  nonowner occupied
    
    $
    202,342
    
    
    $
    169,576Commercial real estate  owner occupied
    
    
    177,526
    
    
    
    168,425Commercial and industrial
    
    
    156,042
    
    
    
    178,808Multi-family
    
    
    73,375
    
    
    
    66,350Small business
    
    
    59,756
    
    
    
    56,148Construction
    
    
    31,035
    
    
    
    23,405Leases and other (a)
    
    
    76,417
    
    
    
    75,057Subtotal
    
    
    776,493
    
    
    
    737,769Unearned lease income
    
    
    (6,516
    )
    
    
    (7,693
    )Net deferred loan origination costs
    
    
    1,777
    
    
    
    2,321Total commercial loans and leases
    
    
    771,754
    
    
    
    732,397Residential mortgage loans:One- to four-family adjustable rate
    
    
    107,959
    
    
    
    115,855One- to four-family fixed rate
    
    
    52,503
    
    
    
    56,724Subtotal
    
    
    160,462
    
    
    
    172,579Premium on loans acquired
    
    
    654
    
    
    
    738Net deferred loan origination fees
    
    
    (10
    )
    
    
    (23
    )Total residential mortgage loans
    
    
    161,106
    
    
    
    173,294Consumer loans:Home equity  term loans
    
    
    114,951
    
    
    
    119,909Home equity  lines of credit
    
    
    84,845
    
    
    
    83,771Unsecured and other
    
    
    1,598
    
    
    
    1,410Subtotal
    
    
    201,394
    
    
    
    205,090Net deferred loan origination costs
    
    
    973
    
    
    
    1,066Total consumer loans
    
    
    202,367
    
    
    
    206,156Total loans and leases receivable
    
    $
    1,135,227
    
    
    $
    1,111,847
 (a)
    
    There were no leases held for sale at September 30, 2010 or December 31, 2009. Deposits
   September 30, 2010
    
    
    December 31, 2009Percent
    
    
    Weighted
    
    
    
    
    
    
    Percent
    
    
    WeightedOf
    
    
    Average
    
    
    
    
    
    
    of
    
    
    AverageAmount
    
    
    Total
    
    
    Rate
    
    
    Amount
    
    
    Total
    
    
    Rate(In thousands)NOW accounts
    
    $
    66,166
    
    
    
    5.9
    %
    
    
    0.06
    %
    
    $
    74,558
    
    
    
    6.8
    %
    
    
    0.09
    %Money market accounts
    
    
    82,151
    
    
    
    7.4
    %
    
    
    0.59
    %
    
    
    65,076
    
    
    
    5.9
    %
    
    
    1.10
    %Savings accounts
    
    
    364,160
    
    
    
    32.6
    %
    
    
    0.40
    %
    
    
    367,225
    
    
    
    33.4
    %
    
    
    0.64
    %Certificate of deposit accounts
    
    
    360,578
    
    
    
    32.3
    %
    
    
    1.42
    %
    
    
    387,144
    
    
    
    35.3
    %
    
    
    1.80
    %Total interest bearing deposits
    
    
    873,055
    
    
    
    78.2
    %
    
    
    0.81
    %
    
    
    894,003
    
    
    
    81.4
    %
    
    
    1.13
    %Noninterest bearing accounts
    
    
    242,628
    
    
    
    21.8
    %
    
    
    0.00
    %
    
    
    204,281
    
    
    
    18.6
    %
    
    
    0.00
    %Total deposits
    
    $
    1,115,683
    
    
    
    100.0
    %
    
    
    0.63
    %
    
    $
    1,098,284
    
    
    
    100.0
    %
    
    
    0.92
    %
  28




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##### Table of Contents



Borrowings
   Asset Quality
  Nonperforming assets 
  September 30,
    
    
    December 31,2010
    
    
    2009(In thousands)Loans and leases accounted for on a nonaccrual basis
    
    $
    12,621
    
    
    $
    16,830Loans and leases past due 90 days or more, but still accruing
    
    
    
    
    
    
    826Restructured loans and leases on a nonaccrual basis
    
    
    1,401
    
    
    
    659Total nonperforming loans and leases
    
    
    14,022
    
    
    
    18,315Other real estate owned
    
    
    1,130
    
    
    
    1,700Total nonperforming assets
    
    $
    15,152
    
    
    $
    20,015Delinquent loans and leases 60-89 days past due
    
    $
    2,548
    
    
    $
    2,028Restructured loans and leases not included in nonperforming assets
    
    
    435
    
    
    
    445Nonperforming loans and leases as a percent of total loans and leases
    
    
    1.24
    %
    
    
    1.65
    %Nonperforming assets as a percent of total assets
    
    
    0.96
    %
    
    
    1.26
    %Delinquent loans and leases 60-89 days past due as a percent of
total loans and leases
    
    
    0.22
    %
    
    
    0.19
    %
  29




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##### Table of Contents



September 30,
    
    
    December 31,2010
    
    
    2009(In thousands)Nonperforming loans and leases:Commercial real estate
    
    $
    5,384
    
    
    $
    6,909Commercial and industrial
    
    
    1,455
    
    
    
    2,919Multifamily
    
    
    
    
    
    
    205Small business
    
    
    1,158
    
    
    
    1,147Construction
    
    
    469
    
    
    
    469Leases
    
    
    1,115
    
    
    
    1,878Residential
    
    
    3,570
    
    
    
    4,124Consumer
    
    
    871
    
    
    
    664Total nonperforming loans and leases
    
    $
    14,022
    
    
    $
    18,315
  Higher-Risk Loans 
 Adversely
classified assets
   30




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##### Table of Contents



Allowance for Loan and Lease Losses
   Nine Months
    
    
    Nine MonthsEnded
    
    
    EndedSeptember 30, 2010
    
    
    September 30, 2009(In thousands)Balance at beginning of period
    
    $
    16,536
    
    
    $
    14,664Loans and leases charged-off:Commercial real estate loans
    
    
    (627
    )
    
    
    (50
    )Commercial and industrial loans
    
    
    
    
    
    
    (1,770
    )Small business loans
    
    
    (633
    )
    
    
    (864
    )Leases
    
    
    (546
    )
    
    
    (67
    )Residential mortgage loans
    
    
    (932
    )
    
    
    (1,486
    )Consumer and other loans
    
    
    (270
    )
    
    
    (59
    )Total loans charged-off
    
    
    (3,008
    )
    
    
    (4,296
    )Recoveries of loans and leases previously charged-off:Commercial real estate loans
    
    
    179
    
    
    
    Commercial and industrial loans
    
    
    20
    
    
    
    13Small business loans
    
    
    29
    
    
    
    11Leases
    
    
    7
    
    
    
    4Residential mortgage loans
    
    
    7
    
    
    
    2Consumer and other loans
    
    
    17
    
    
    
    29Total recoveries of loans previously charged-off
    
    
    259
    
    
    
    59Net charge-offs
    
    
    (2,749
    )
    
    
    (4,237
    )Provision for loan and lease losses charged against income
    
    
    4,425
    
    
    
    6,110Balance at end of period
    
    $
    18,212
    
    
    $
    16,537
  31




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##### Table of Contents



September 30,
    
    
    December 31,2010
    
    
    2009(In thousands)Loan categoryCommercial loans and leases
    
    $
    13,087
    
    
    $
    12,409Residential mortgage loans
    
    
    1,480
    
    
    
    1,340Consumer and other loans
    
    
    1,685
    
    
    
    1,504Unallocated
    
    
    1,960
    
    
    
    1,283Total
    
    $
    18,212
    
    
    $
    16,536
    32




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##### Table of Contents



Results of Operations  Executive Overview
  For the three-month periods endedSeptember 30,
    
    
    June 30,
    
    
    March 31,
    
    
    December 31,
    
    
    September 30,2010
    
    
    2010
    
    
    2010
    
    
    2009
    
    
    2009(Dollars in thousands, except per share data)Income statement data:Net interest income
    
    $
    13,478
    
    
    $
    13,626
    
    
    $
    13,088
    
    
    $
    13,001
    
    
    $
    12,666Noninterest income
    
    
    2,289
    
    
    
    2,285
    
    
    
    2,315
    
    
    
    2,353
    
    
    
    2,241Noninterest expense
    
    
    10,350
    
    
    
    10,430
    
    
    
    10,488
    
    
    
    9,949
    
    
    
    9,812Net income
    
    
    2,808
    
    
    
    2,681
    
    
    
    2,219
    
    
    
    1,133
    
    
    
    2,203Net income applicable to common shares
    
    
    2,808
    
    
    
    2,681
    
    
    
    2,219
    
    
    
    1,133
    
    
    
    779Per share data:Diluted earnings per share
    
    $
    0.60
    
    
    $
    0.57
    
    
    $
    0.48
    
    
    $
    0.24
    
    
    $
    0.17Dividends per common share
    
    $
    0.17
    
    
    $
    0.17
    
    
    $
    0.17
    
    
    $
    0.17
    
    
    $
    0.17Operating ratios:Net interest margin (1) (5)
    
    
    3.61
    %
    
    
    3.67
    %
    
    
    3.52
    %
    
    
    3.42
    %
    
    
    3.38
    %Return on assets (2) (5)
    
    
    0.71
    %
    
    
    0.68
    %
    
    
    0.57
    %
    
    
    0.28
    %
    
    
    0.56
    %Return on equity (3) (5)
    
    
    8.57
    %
    
    
    8.54
    %
    
    
    7.32
    %
    
    
    3.67
    %
    
    
    2.56
    %Efficiency ratio (4) (5)
    
    
    65.64
    %
    
    
    65.55
    %
    
    
    68.09
    %
    
    
    64.80
    %
    
    
    65.82
    %
 (1)
    
    Calculated by dividing annualized net interest income by average interest-earning assets.(2)
    
    Calculated by dividing annualized net income by average total assets.(3)
    
    Calculated by dividing annualized net income applicable to common shares by average
common shareholders equity.(4)
    
    Calculated by dividing noninterest expense by net interest income plus noninterest
income.(5)
    
    Non-GAAP performance measure.        33




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##### Table of Contents



Results of Operations  Comparison of the Three Months Ended September 30, 2010 and 2009
 General
  Net Interest Income
   34




---



##### Table of Contents



Average Balances, Yields and Costs
 For the three months ended September 30,2010
    
    
    2009Interest
    
    
    
    
    
    
    
    
    
    
    InterestAverage
    
    
    Earned/
    
    
    Average
    
    
    Average
    
    
    Earned/
    
    
    Average(In thousands)
    
    Balance
    
    
    Paid
    
    
    Yield
    
    
    Balance
    
    
    Paid
    
    
    YieldAssetsEarning assets:Overnight investments
    
    $
    5,220
    
    
    $
    1
    
    
    
    0.08
    %
    
    $
    851
    
    
    $
    1
    
    
    
    0.06
    %Available for sale securities
    
    
    344,872
    
    
    
    3,226
    
    
    
    3.74
    %
    
    
    360,586
    
    
    
    3,876
    
    
    
    4.26
    %Stock in the FHLB
    
    
    16,274
    
    
    
    
    
    
    
    0.00
    %
    
    
    16,024
    
    
    
    
    
    
    
    0.00
    %Loans and leases receivable:Commercial loans and leases
    
    
    760,236
    
    
    
    10,788
    
    
    
    5.64
    %
    
    
    718,175
    
    
    
    10,437
    
    
    
    5.78
    %Residential mortgage loans
    
    
    162,473
    
    
    
    1,874
    
    
    
    4.61
    %
    
    
    187,041
    
    
    
    2,302
    
    
    
    4.92
    %Consumer and other loans
    
    
    205,978
    
    
    
    2,265
    
    
    
    4.36
    %
    
    
    212,109
    
    
    
    2,384
    
    
    
    4.46
    %Total earning assets
    
    
    1,495,053
    
    
    
    18,154
    
    
    
    4.83
    %
    
    
    1,494,786
    
    
    
    19,000
    
    
    
    5.06
    %Cash and due from banks
    
    
    15,617
    
    
    
    
    
    
    
    
    
    
    
    16,828Allowance for loan and lease losses
    
    
    (17,683
    )
    
    
    
    
    
    
    
    
    
    
    (17,088
    )Premises and equipment
    
    
    12,136
    
    
    
    
    
    
    
    
    
    
    
    12,604Goodwill, net
    
    
    12,262
    
    
    
    
    
    
    
    
    
    
    
    12,051Accrued interest receivable
    
    
    4,346
    
    
    
    
    
    
    
    
    
    
    
    4,355Bank-owned life insurance
    
    
    30,761
    
    
    
    
    
    
    
    
    
    
    
    29,465Prepaid expenses and other assets
    
    
    16,535
    
    
    
    
    
    
    
    
    
    
    
    9,069Total assets
    
    $
    1,569,027
    
    
    
    
    
    
    
    
    
    
    $
    1,562,070Liabilities and Shareholders EquityInterest-bearing liabilities:Deposits:NOW accounts
    
    $
    71,493
    
    
    $
    10
    
    
    
    0.06
    %
    
    $
    65,365
    
    
    $
    13
    
    
    
    0.08
    %Money market accounts
    
    
    81,539
    
    
    
    138
    
    
    
    0.68
    %
    
    
    43,543
    
    
    
    140
    
    
    
    1.27
    %Savings accounts
    
    
    366,125
    
    
    
    395
    
    
    
    0.43
    %
    
    
    369,019
    
    
    
    707
    
    
    
    0.76
    %Certificate of deposit accounts
    
    
    364,245
    
    
    
    1,367
    
    
    
    1.49
    %
    
    
    398,923
    
    
    
    2,448
    
    
    
    2.43
    %Overnight and short-term borrowings
    
    
    39,675
    
    
    
    16
    
    
    
    0.16
    %
    
    
    41,566
    
    
    
    19
    
    
    
    0.19
    %Wholesale repurchase agreements
    
    
    13,804
    
    
    
    139
    
    
    
    3.94
    %
    
    
    15,326
    
    
    
    141
    
    
    
    3.63
    %FHLB borrowings
    
    
    233,124
    
    
    
    2,438
    
    
    
    4.09
    %
    
    
    276,722
    
    
    
    2,691
    
    
    
    3.81
    %Subordinated deferrable interest debentures
    
    
    13,403
    
    
    
    173
    
    
    
    5.08
    %
    
    
    13,403
    
    
    
    175
    
    
    
    5.18
    %Total interest-bearing liabilities
    
    
    1,183,408
    
    
    
    4,676
    
    
    
    1.57
    %
    
    
    1,223,867
    
    
    
    6,334
    
    
    
    2.05
    %Noninterest-bearing deposits
    
    
    242,389
    
    
    
    
    
    
    
    
    
    
    
    197,313Other liabilities
    
    
    13,223
    
    
    
    
    
    
    
    
    
    
    
    5,585Total liabilities
    
    
    1,439,020
    
    
    
    
    
    
    
    
    
    
    
    1,426,765Shareholders equity:
    
    
    130,007
    
    
    
    
    
    
    
    
    
    
    
    135,305Total liabilities and shareholders equity
    
    $
    1,569,027
    
    
    
    
    
    
    
    
    
    
    $
    1,562,070Net interest income
    
    
    
    
    
    $
    13,478
    
    
    
    
    
    
    
    
    
    
    $
    12,666Net interest rate spread
    
    
    
    
    
    
    
    
    
    
    3.26
    %
    
    
    
    
    
    
    
    
    
    
    3.01
    %Net interest rate margin
    
    
    
    
    
    
    
    
    
    
    3.61
    %
    
    
    
    
    
    
    
    
    
    
    3.38
    %
  35




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##### Table of Contents



Rate/Volume Analysis 
 Three Months Ended September 30,2010 vs. 2009Increase/(Decrease) Due to(In thousands)
    
    Rate
    
    
    Volume
    
    
    TotalInterest income:Available for sale securities
    
    $
    (424
    )
    
    $
    (226
    )
    
    $
    (650
    )Commercial loans and leases
    
    
    (178
    )
    
    
    529
    
    
    
    351Residential mortgage loans
    
    
    (146
    )
    
    
    (282
    )
    
    
    (428
    )Consumer and other loans
    
    
    (13
    )
    
    
    (106
    )
    
    
    (119
    )Total interest income
    
    
    (761
    )
    
    
    (85
    )
    
    
    (846
    )Interest expense:NOW accounts
    
    
    (4
    )
    
    
    1
    
    
    
    (3
    )Money market accounts
    
    
    (87
    )
    
    
    85
    
    
    
    (2
    )Savings accounts
    
    
    (307
    )
    
    
    (5
    )
    
    
    (312
    )Certificate of deposit accounts
    
    
    (879
    )
    
    
    (202
    )
    
    
    (1,081
    )Overnight and short-term borrowings
    
    
    (3
    )
    
    
    
    
    
    
    (3
    )Wholesales repurchase agreements
    
    
    13
    
    
    
    (15
    )
    
    
    (2
    )FHLB borrowings
    
    
    186
    
    
    
    (439
    )
    
    
    (253
    )Subordinated deferrable interest debentures
    
    
    (2
    )
    
    
    
    
    
    
    (2
    )Total interest expense
    
    
    (1,083
    )
    
    
    (575
    )
    
    
    (1,658
    )Net interest income
    
    $
    322
    
    
    $
    490
    
    
    $
    812
 Interest Income  Investments 
  Interest Income  Loans and Leases
  Interest Expense  Deposits and Borrowings 
  36




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##### Table of Contents



Provision for Loan and Lease Losses
  Allowance for Loan and Lease Losses.
 Noninterest Income
  Noninterest Expense
     37




---



##### Table of Contents



Income Tax Expense
  Note 8  Contingent Liabilities
 Results of Operations  Comparison of the Nine Months Ended September 30, 2010 and 2009
 General
  Net Interest Income
   38




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##### Table of Contents



Average Balances, Yields and Costs
 Nine Months Ended September 30,2010
    
    
    2009Interest
    
    
    
    
    
    
    
    
    
    
    InterestAverage
    
    
    Earned/
    
    
    Average
    
    
    Average
    
    
    Earned/
    
    
    Average(In thousands)
    
    Balance
    
    
    Paid
    
    
    Yield
    
    
    Balance
    
    
    Paid
    
    
    YieldAssetsEarning assets:Overnight investments
    
    $
    3,174
    
    
    $
    6
    
    
    
    0.27
    %
    
    $
    1,607
    
    
    $
    10
    
    
    
    0.80
    %Available for sale securities
    
    
    354,663
    
    
    
    10,536
    
    
    
    3.96
    %
    
    
    358,019
    
    
    
    11,626
    
    
    
    4.34
    %Stock in the FHLB
    
    
    16,274
    
    
    
    
    
    
    
    0.00
    %
    
    
    15,790
    
    
    
    
    
    
    
    0.00
    %Loans receivable:Commercial loans and leases
    
    
    750,035
    
    
    
    32,042
    
    
    
    5.71
    %
    
    
    695,368
    
    
    
    30,184
    
    
    
    5.80
    %Residential mortgage loans
    
    
    167,354
    
    
    
    5,842
    
    
    
    4.65
    %
    
    
    197,588
    
    
    
    7,422
    
    
    
    5.01
    %Consumer and other loans
    
    
    204,692
    
    
    
    6,716
    
    
    
    4.39
    %
    
    
    211,613
    
    
    
    7,110
    
    
    
    4.49
    %Total earning assets
    
    
    1,496,192
    
    
    
    55,142
    
    
    
    4.92
    %
    
    
    1,479,985
    
    
    
    56,352
    
    
    
    5.08
    %Cash and due from banks
    
    
    15,963
    
    
    
    
    
    
    
    
    
    
    
    19,122Allowance for loan and lease losses
    
    
    (17,316
    )
    
    
    
    
    
    
    
    
    
    
    (15,852
    )Premises and equipment
    
    
    12,246
    
    
    
    
    
    
    
    
    
    
    
    12,528Goodwill, net
    
    
    12,235
    
    
    
    
    
    
    
    
    
    
    
    12,056Accrued interest receivable
    
    
    4,323
    
    
    
    
    
    
    
    
    
    
    
    4,286Bank-owned life insurance
    
    
    30,440
    
    
    
    
    
    
    
    
    
    
    
    29,164Prepaid expenses and other assets
    
    
    16,103
    
    
    
    
    
    
    
    
    
    
    
    8,991Total assets
    
    $
    1,570,186
    
    
    
    
    
    
    
    
    
    
    $
    1,550,280Liabilities and Shareholders EquityInterest-bearing liabilities:Deposits:NOW accounts
    
    $
    69,857
    
    
    $
    37
    
    
    
    0.07
    %
    
    $
    64,576
    
    
    $
    45
    
    
    
    0.09
    %Money market accounts
    
    
    78,103
    
    
    
    452
    
    
    
    0.77
    %
    
    
    21,602
    
    
    
    192
    
    
    
    1.19
    %Savings accounts
    
    
    369,686
    
    
    
    1,432
    
    
    
    0.52
    %
    
    
    380,308
    
    
    
    2,720
    
    
    
    0.96
    %Certificate of deposit accounts
    
    
    374,848
    
    
    
    4,431
    
    
    
    1.58
    %
    
    
    414,011
    
    
    
    9,069
    
    
    
    2.93
    %Overnight and short-term borrowings
    
    
    38,617
    
    
    
    53
    
    
    
    0.18
    %
    
    
    46,253
    
    
    
    67
    
    
    
    0.20
    %Wholesale repurchase agreements
    
    
    17,326
    
    
    
    421
    
    
    
    3.20
    %
    
    
    11,795
    
    
    
    408
    
    
    
    4.62
    %FHLB borrowings
    
    
    250,721
    
    
    
    7,621
    
    
    
    4.01
    %
    
    
    258,189
    
    
    
    7,966
    
    
    
    4.07
    %Subordinated deferrable interest debentures
    
    
    13,403
    
    
    
    503
    
    
    
    4.98
    %
    
    
    13,403
    
    
    
    564
    
    
    
    5.61
    %Total interest-bearing liabilities
    
    
    1,212,561
    
    
    
    14,950
    
    
    
    1.65
    %
    
    
    1,210,137
    
    
    
    21,031
    
    
    
    2.32
    %Noninterest-bearing deposits
    
    
    220,576
    
    
    
    
    
    
    
    
    
    
    
    184,747Other liabilities
    
    
    10,742
    
    
    
    
    
    
    
    
    
    
    
    11,258Total liabilities
    
    
    1,443,879
    
    
    
    
    
    
    
    
    
    
    
    1,406,142Shareholders Equity:
    
    
    126,307
    
    
    
    
    
    
    
    
    
    
    
    144,138Total liabilities and shareholders equity
    
    $
    1,570,186
    
    
    
    
    
    
    
    
    
    
    $
    1,550,280Net interest income
    
    
    
    
    
    $
    40,192
    
    
    
    
    
    
    
    
    
    
    $
    35,321Net interest rate spread
    
    
    
    
    
    
    
    
    
    
    3.27
    %
    
    
    
    
    
    
    
    
    
    
    2.76
    %Net interest rate margin
    
    
    
    
    
    
    
    
    
    
    3.59
    %
    
    
    
    
    
    
    
    
    
    
    3.19
    %
  39




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Rate/Volume Analysis 
 Nine Months Ended September 30,2010 vs. 2009Increase/(decrease) due to(In thousands)
    
    Rate
    
    
    Volume
    
    
    TotalInterest income:Overnight investments
    
    $
    (9
    )
    
    $
    5
    
    
    $
    (4
    )Available for sale securities
    
    
    (839
    )
    
    
    (251
    )
    
    
    (1,090
    )Commercial loans and leases
    
    
    (375
    )
    
    
    2,233
    
    
    
    1,858Residential mortgage loans
    
    
    (524
    )
    
    
    (1,056
    )
    
    
    (1,580
    )Consumer and other loans
    
    
    (1
    )
    
    
    (393
    )
    
    
    (394
    )Total interest income
    
    
    (1,748
    )
    
    
    538
    
    
    
    (1,210
    )Interest expense:NOW accounts
    
    
    (11
    )
    
    
    3
    
    
    
    (8
    )Money market accounts
    
    
    (85
    )
    
    
    345
    
    
    
    260Savings accounts
    
    
    (1,214
    )
    
    
    (74
    )
    
    
    (1,288
    )Certificate of deposit accounts
    
    
    (3,766
    )
    
    
    (872
    )
    
    
    (4,638
    )Overnight and short-term borrowings
    
    
    (4
    )
    
    
    (10
    )
    
    
    (14
    )Wholesale repurchase agreements
    
    
    (144
    )
    
    
    157
    
    
    
    13FHLB borrowings
    
    
    (120
    )
    
    
    (225
    )
    
    
    (345
    )Subordinated deferrable interest debentures
    
    
    (61
    )
    
    
    
    
    
    
    (61
    )Total interest expense
    
    
    (5,405
    )
    
    
    (676
    )
    
    
    (6,081
    )Net interest income
    
    $
    3,657
    
    
    $
    1,214
    
    
    $
    4,871
 Interest Income  Investments 
 Interest Income  Loans and Leases
  Interest Expense  Deposits and Borrowings 
  40




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Provision for Loan and Lease Losses
  Allowance for Loan and Lease Losses.
 Noninterest Income
  Noninterest Expense
    41




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##### Table of Contents



Income Tax Expense
  Note 8  Contingent Liabilities
 Liquidity and Capital Resources
 Liquidity
    Capital Resources
   42




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##### Table of Contents



Minimum Required
    
    
    Minimum RequiredFor Capital
    
    
    To Be ConsideredActual
    
    
    Adequacy Purposes
    
    
    Well-CapitalizedAmount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio
    
    
    Amount
    
    
    Ratio(Dollars in thousands)At September 30, 2010:Bancorp Rhode Island, Inc.Tier I capital (to average assets)
    
    $
    126,303
    
    
    
    8.10
    %
    
    $
    62,401
    
    
    
    4.00
    %
    
    $
    78,001
    
    
    
    5.00
    %Tier I capital (to risk weighted assets)
    
    
    126,303
    
    
    
    11.26
    %
    
    
    44,852
    
    
    
    4.00
    %
    
    
    67,278
    
    
    
    6.00
    %Total capital (to risk weighted assets)
    
    
    140,369
    
    
    
    12.52
    %
    
    
    89,704
    
    
    
    8.00
    %
    
    
    112,129
    
    
    
    10.00
    %Bank Rhode IslandTier I capital (to average assets)
    
    $
    124,505
    
    
    
    7.98
    %
    
    $
    62,377
    
    
    
    4.00
    %
    
    $
    77,972
    
    
    
    5.00
    %Tier I capital (to risk weighted assets)
    
    
    124,505
    
    
    
    11.11
    %
    
    
    44,827
    
    
    
    4.00
    %
    
    
    67,241
    
    
    
    6.00
    %Total capital (to risk weighted assets)
    
    
    138,571
    
    
    
    12.36
    %
    
    
    89,655
    
    
    
    8.00
    %
    
    
    112,069
    
    
    
    10.00
    %At December 31, 2009:Bancorp Rhode Island, Inc.Tier I capital (to average assets)
    
    $
    120,297
    
    
    
    7.65
    %
    
    $
    62,941
    
    
    
    4.00
    %
    
    $
    78,676
    
    
    
    5.00
    %Tier I capital (to risk weighted assets)
    
    
    120,297
    
    
    
    10.71
    %
    
    
    44,913
    
    
    
    4.00
    %
    
    
    67,369
    
    
    
    6.00
    %Total capital (to risk weighted assets)
    
    
    134,364
    
    
    
    11.97
    %
    
    
    89,825
    
    
    
    8.00
    %
    
    
    112,281
    
    
    
    10.00
    %Bank Rhode IslandTier I capital (to average assets)
    
    $
    118,412
    
    
    
    7.54
    %
    
    $
    62,855
    
    
    
    4.00
    %
    
    $
    78,569
    
    
    
    5.00
    %Tier I capital (to risk weighted assets)
    
    
    118,412
    
    
    
    10.55
    %
    
    
    44,882
    
    
    
    4.00
    %
    
    
    67,323
    
    
    
    6.00
    %Total capital (to risk weighted assets)
    
    
    132,479
    
    
    
    11.81
    %
    
    
    89,764
    
    
    
    8.00
    %
    
    
    112,205
    
    
    
    10.00
    %
 Recent Accounting Pronouncements
 Note 4  Recently Issued Accounting Pronouncements
 Recent Market and Regulatory Developments
   43




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44




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##### Table of Contents



ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
 Interest Rate Risk
     Estimated Exposureto Net Interest IncomeDollar
    
    
    PercentChange
    
    
    Change(Dollars in thousands)Initial Twelve Month Period:Up 300 bps
    
    $
    (314
    )
    
    
    -0.59
    %
  Asset and Liability
Management
  45




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##### Table of Contents



ITEM 4. Controls and Procedures
    46




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PART II. Other Information
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  Recent Legislative Reforms Can Result in the Companys Business Becoming Subject to
Significant and Extensive Additional Regulations and/or Can Adversely Affect the Companys
Results of Operations and Financial Condition.
   
    
    Change of the deposit insurance assessment base from the amount of
insured deposits to consolidated assets less tangible capital, elimination of the
ceiling on the size of the Deposit Insurance Fund (the DIF), and increase to the
floor applicable to the size of the DIF, which generally will require financial
institutions with assets in excess of $10 billion to pay a higher percentage of the
aggregate insurance assessment than smaller institutions, such as Bank Rhode
Island;
    
    Permanent increase of the standard maximum amount of deposit insurance
per customer to $250,000, and unlimited federal deposit insurance until January 1,
2013 for non-interest bearing demand transaction accounts at all insured depository
institutions;
  47




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##### Table of Contents




    
    Repeal of the current prohibition on the payment of interest on demand
deposits effective July 21, 2011, thereby permitting depository institutions to pay
interest on business transaction and other accounts;
    
    Creation of a new consumer financial protection bureau empowered to
exercise broad regulatory, supervisory and enforcement authority with respect
federal consumer financial protection laws and with power to prohibit practices
that it finds to be unfair, deceptive, or abusive;
    
    New capital regulations for thrift holding companies will be adopted
and any new trust preferred securities will no longer count toward Tier 1 capital;;
    
    New regulations on mortgage originators and new disclosure requirements
and appraisal reforms intended to curb predatory lending; and
    
    New corporate governance requirements, including with regard to
executive compensation and proxy access by shareholders, that apply to all public
companies, not just financial institutions.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 5. Other Information
   48




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Item 6.
Exhibits
 31.1
    
    
    Certification of Chief Executive Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 200231.2
    
    
    Certification of Chief Financial Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 200232.1
    
    
    Certification of Chief Executive Officer pursuant to 18 U.S.C.
Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
200232.2
    
    
    Certification of Chief Financial Officer pursuant to 18 U.S.C.
Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002
 
  49




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##### Table of Contents



BANCORP RHODE ISLAND, INC.
 
   Bancorp Rhode Island, Inc.November 4, 2010
    
    
    
    /s/ Merrill W. Sherman(Date)
    
    
    
    Merrill W. ShermanPresident and Chief Executive OfficerNovember 4, 2010
    
    
    
    /s/ Linda H. Simmons(Date)
    
    
    
    Linda H. SimmonsChief Financial Officer and Treasurer
  50